PERTH (miningweekly.com) – Gold miner Evolution Mining has failed to hit its costs guidance for the 2019 financial year, with executive chairperson Jake Klein saying that the company was determined to remain focused on margins and operating efficiencies.

Gold production in the June quarter reached 194 866 oz, bringing full-year production to 753 001 oz, which was well within the full-year guidance of between 720 000 oz and 770 000 oz.

However, all-in sustaining costs (AISC) for the full year had reached A$924/oz, which was above the guidance of between A$850/oz and A$900/oz. Evolution told shareholders on Wednesday that the higher AISC was driven by both operational and non-operational factors.

The miner noted that despite an improved performance during June, the Mungari operation experienced slight delays in some of the Frog’s Leg Mists stopes, which resulted in an overall lower-than-anticipated grade processed.

Furthermore, the Mt Rawdon operation was unable to extract sufficient higher-grade ore as it transitioned back into the northern end of the pit.

Additionally, metal prices in the June quarter also negatively impacted AISC due to higher royalties and lower by-product credits.

“We are disappointed we did not deliver on our cost guidance in 2019. We are determined to remain focused on margin and operating efficiencies, which is reflected in our guidance for 2020. This will ensure we maintain our position as one of the lowest cost gold producers in the world and continue to generate superior returns for our shareholders,” Klein said.

For 2020, Evolution is forecasting group gold production to reach between 725 000 oz and 775 000 oz, with AISC estimated at between A$890/oz and A$940/oz.

The miner is also expected to spend between A$195-million and A$235-million on capital projects during the 2020 financial year, with the bulk of the major project capital investment going towards the expansion projects at Cowal, as the operation delivers on its objective of increasing production form 250 000 oz/y to 300 000 oz/y.

Evolution will also be spending between A$80-million and A$105-million on exploration in 2020, which is up from the A$50-million spent in the 2019 financial year, on the back of the success at the Cowal operation.